Tuesday, May 11, 2010

Roubini on The $1 Trillion EU rescue Package to Greece

Roubini Discusses $1 Trillion European Loan Package

Nouriel Roubini : The IMF is expecting three more years of recession in Greece most likely you will have recession in Spain in Portugal in Italy and the question is political again : can you afford have several years of recession and deflation there may be at some point a backlash against it three of these countries have also lost competitiveness in the last few years , they are losing market shares to China and Asia because their exports are labor intensive then for a decade their wages are growing faster than the productivity , and the final nail in the coffin was the appreciation of the Euro between 2000 and 2008 , so even if they stabilize their public debt how are they going to reduce their larger currency deficit..., it is going to be ugly in terms of fiscal austerity in terms of structural forms in terms of anemic growth if not recession therefore there is money on the table but it is all conditional on doing very painful sacrifices , I feel that some countries like Greece are not going to be able to do it , that eventually they are going to have a restructuring of public debt .....
May 11 (Bloomberg) -- New York University professor Nouriel Roubini, chairman of Roubini Global Economics LLC, talks with Bloomberg's Carol Massar and Matt Miller about the $1 trillion European loan package to help stop the sovereign-debt crisis. (This is an excerpt of the full interview. Source: Bloomberg)

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